Record Breaking Sports Betting Numbers
July 20, 2018
The Supreme Court struck down the PAPSA law earlier this year and now states are free to license and regulate sports betting as they see fit. It is estimated by the people at Eilers & Krejcik gaming that up to 32 states will have some form of legalized and regulated sports betting in the next five years.
I’ve already pointed out in a previous article that in Las Vegas, where most any type of bet is legal, sports betting is dwarfed by all other forms of gambling. In fact, sports betting set a record last year at Vegas sportsbooks for both handle (almost $5 billion) and percentage of gaming revenue (2.15%). That last number really puts it into perspective.
But before PAPSA was even struck down, why was sports betting on a meteoric rise? There are several factors that resulted in 2017’s record year for sports betting in Las Vegas:
Population size
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Yes,the population is growing very fast. More people means more gamblers. That is a simple equation. Despite two world wars, a civil war, countless flu epidemics and AIDS, the population isn’t slowing down for anything. People love to make babies. According to Immigration EIS, the population has gone from 50 million in 1870 to a whopping 304 million in 2008. And if you need a smaller sample size, take that Trading Economics posted a graph showing that the US population has grown from 304 million in 2008 to 325 million in 2018. Of course, it is not all a result of natural reproduction. This is why I referred to the immigration site as well.
General Acceptance of Sports Wagering Type Games
The fantasy sports that have really exploded in the last decade or so had people actively sending money to a company, then waiting for player performance outcomes to find out if they won or lost money. If that isn’t gambling I don’t know what is. Well, the public seems to agree with that last statement because Fantasy Sports are often credited with inspiring the latest push into legalizing sports betting.
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Steemit.com reports that just in the last five years, participation in fantasy sports has gone from 25 million people to 35 million people. They also expect that number to double in the next 8 years. Disclaimer: these are fantasy football numbers and not necessarily leagues that involve real money.
Disposable Income
Not only are there more people, but those people have more money to spend. According to statista the average citizen in the U.S. has been gaining more disposable income every year. Their website shows statistics starting in 2000 and ending in 2017 where there is a constant upward trend.
States Need Money
So why do studies forecast as many as 32 states will have sportsbooks in the next five years? The bottom line is that state governments go through more money than they take in. It is a sad part of reality that the people put in charge of the system cannot balance a budget. So, they are always looking for new ways to generate money. And by generate, I mean take more money from people. They will soon discover that the margins in sports betting aren’t all that they probably started off thinking they would be.
Regardless of the money generated for states, sports betting will continue to set new records each and every year, a theory almost guaranteed by the opening of new sportsbooks in possibly each and every state.
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